6 Tips and Tricks To Manage Your Loans (And Pay Them Off Quicker!)
A Guide To Organizing Your Loans
Living life frugally is something that all of us aspire to master, so we can live as comfortable as we can. However, this matter calls for being able to have full control over your finances. If you’re quite pre-occupied with #adulting life, it might even be a greater challenge to allot a chunk of time for financial management.
Despite life being as busy as it already is, organizing your finances still plays a crucial role on the road towards financial success. Today, we will give focus to the first thing you should eliminate to get into a more comfortable lifestyle: your debts. Having debts is normal, it’s just a part of life. But, missing payments can prohibit you from getting that financial freedom and it can even lead you to more debt.
So, to help you become better in management, here are tips and tricks on how you can get your loan organization in check.
- Make a list of everything that you owe.
Before diving on anything else, the first thing that you have to do is to compile everything that you own and list them. May it be on a journal, a planner, an app, or a spreadsheet, make a resource where you have the total amount you owe, who you owe it to, the interest rate, your monthly due date, and when the loan will be fully paid.
This might hurt you a little but having everything in one space will give you the overall picture of the state of your finances. Make this summary a motivation to be better in handling your money and not letting your impulses take control of your life.
- Make it a point to pay your bills on time.
In paying off loans, you should be particular and meticulous in monitoring due dates. If you make late payments, you have to spend more because of interest piling up, late fees, and other charges.
The easiest to accomplish this goal is to make the most of your phone’s calendar. Just set an alert a few days before your monthly due date and you get to be reminded of the things you have to pay. Make sure to put everything in and try to connect it to the nearest paycheck date.
- Rank your debts by importance.
If you cannot afford to pay all of your loans at a time, take some time to rank all of your debts and list in them in the order of importance. You can go about it in two ways: pay off the one with the least balance or pay off the ones with the highest interest first. Usually, credit cards require the most priority because of all the additional fees and higher interest rates it comes with.
4. If you can set up, Auto Pay options.
For those who have a regular flow of income, consider scheduling Auto Pay with your current bank account. This is a program where your savings or current account will automatically transfer the repayment amount you set to your lender. With this program, you need not worry about being late for payments, too. The only thing you have to make sure of is maintaining the funds you have to have on your account every time the collection date draws near.
5. Keep all of your documents about your debt in one spot.
Each loan or debt that you have come with their own set of processing papers, promissory notes, and other pertinent documents. There may be times when referring back to these papers are needed. Also, it is crucial that you keep proof of all of your repayments, in case there might be discrepancies on record. Just so that you can be secure should a need for official documents arise, it is important to make a filing system to ensure that you have all your records at hand.
Many financial experts suggest that debt consolidation as an effective money management strategy that can help you merge multiple bills into one – making it much easier to control and pay them off. Most of the time, it can help individual save on costs because the interest is lowered and monthly payments become more controlled.
There are different ways to go about debt consolidation. You can apply a debt management plan wherein you work with credit consulting agencies to help you manage payments in affordable monthly increments. Second, you can also negotiate debt settlement. This method means working alone or with a company to pay less than the amount that you owe and close off a loan. Next, you can also use a credit card balance transfer to combine your existing balance from different credit cards. Usually, this allows you to get 0% interest for a set period and you only have to pay the transfer fee.
Finally, one thing to consolidate your debts is taking out a personal loan. You can apply from a bank, a credit union, a P2P lending platform, a lending company, a close friend, or even from a family member. This method of borrowing usually does not require having an additional collateral and you can be able to enjoy a way to close off your debts and focus on settling just one.
Blend.ph is the Philippines’ leading peer-to-peer funding platform who offers different loan products, including personal loans. Our loan product usually have better rates compared to traditional banking and the application process is quicker compared to traditional lending providers.
If you are tired of having to monitor different types of debts and juggling each of them, consider taking out a Blend.ph loan to have them all in one place. Register to be a Blend.ph borrower now.